PG&E signs new power agreements

By IBT Staff Reporter On 10/01/09 AT 5:55 PM

LOS ANGELES - California utility Pacific Gas and Electric said on Thursday that it has signed power agreements for more than 2,000 megawatts, boosting its use of energy from solar resources and natural gas.

The deals include contracts for more than 830 MW of power from solar developers. The utility, a unit of PG&E Corp, declined to name the solar developers or give the value of the agreements.

California utilities have been a bright spot in the solar market because they must meet a state mandate to produce 20 percent of their power from renewable resources by 2010 and then a third by 2020.

PG&E said it is seeking to buy power from two new natural gas-fired plants: a 719 MW plant near Antioch, which will be owned by a unit of Mirant Corp and a 586 MW air-cooled plant in Oakley. They are expected to be completed in mid-2013 and 2014, respectively.

The utility also plans to buy more power from an existing plant in Kern County owned by Midway Sunset Cogeneration Co.

As we get more and more renewable energy in our system, (renewable energy), especially wind and solar, fluctuates a lot depending when the sun is shining and the wind is blowing, said Jonathan Marshall, a PG&E spokesman.

You need very flexible facilities and natural gas units are among the best for that, Marshall said.

The California Public Utilities Commission must approve the agreements for the natural gas-fired plants.

Shares of PG&E Corp closed down .7 percent at $40.19 on Thursday on the New York Stock Exchange. (Reporting by Laura Isensee, editing by Leslie Gevirtz)

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